The State Bank of India has joined the sanctions against russian oil

India’s third largest bank has refused to process payments for russian oil whose price exceeds the “price ceiling”.

Since April, India’s Bank of Baroda has stopped clearing payments for russian oil sold above the “price ceiling” set by the West, Reuters reported, citing three sources directly familiar with the matter.

In the past, some Indian refiners paid UAE dirhams for low-sulphur russian crude above $60/bbl through the Bank of Baroda, mainly to Dubai-based traders, the sources said. Oil refiners could pay a higher price and hide the fact of violating Western sanctions.

To protect itself from secondary sanctions, Bank of Baroda warned clients back in March that it would not make payments for russian barrels bought above the maximum price.

“Bank of Baroda is extremely cautious in making payments for purchased russian oil (at levels) above the limit price,” said one of the interlocutors of the publication.

Although India has not officially joined the “price ceiling” for russian oil, it actually complies, according to sources in the market and in the state government.

Before the full-scale war in Ukraine, Indian refiners rarely bought oil from russia due to higher transportation costs. After the introduction of Western sanctions against Moscow for its invasion, Indian refineries began to purchase russian raw materials at significant discounts.